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Bill to exempt small nonprofits from unclaimed property remittance draws scrutiny, vote expunged
Summary
Senate Bill 283 would exempt nonprofits with annual revenues of $5 million or less from unclaimed property remittance to the auditor; the committee recorded a tie, then moved to expunge that vote. Sponsors said many small nonprofits are unaware of current unclaimed-property obligations and that compliance burden can be significant.
Senate Bill 283, which would create an exemption in the unclaimed‑property subchapter for nonprofit organizations with annual revenues under $5,000,000, drew extended questioning at the committee hearing.
Sponsor testimony (Senator Hammer and witness Steve Lux, a nonprofit treasurer) described cases where initiation deposits and small liabilities became difficult to track for long‑running nonprofit entities. Lux said his organization found initiation deposits from the 1990s that remained payable and that nonprofits often are unaware of unclaimed property rules. Sponsor advocates argued the exemption would ease administrative burdens for small nonprofits while keeping the liability on the nonprofit’s books so a rightful owner who later appears could be paid.
Committee members and legal counsel asked for clarity on how the exemption integrates with the existing unclaimed‑property chapter, how “nonprofit” is defined, and whether the $5 million revenue threshold is appropriate. The auditor’s office’s current practice of aggressively searching for owners was described in testimony; witnesses and senators noted that the unclaimed‑property program transfers roughly $18–19 million annually from the unclaimed property fund to general revenue and that the state auditor has resources to locate owners.
When the committee first voted on the bill, a roll-call count in the transcript recorded split votes (the clerk read a mix of “aye” and “no”), producing a tied or evenly divided result on the floor and a statement of the outcome as a failure. The sponsor then moved to expunge that recorded vote, arguing procedural considerations; the committee adopted the motion to expunge the prior recorded vote. The transcript does not show a subsequent final passage vote after the expungement.
Committee discussion raised concerns about leaving other people’s money on nonprofit books, audit enforcement, and the size of the revenue threshold. Sponsors said the proposal had been narrowed from broader initial exemptions and that hospitals and larger nonprofits would remain subject to remittance requirements.
